Tax planning is all about looking forward. What is going to be happening in years to come.


Tax legislation thought is a very different topic because it changes or it stays the same until it changes. 


In 2018 we had the tax cut and jobs act, also known as the Trump Reform. And what that did is reduce our rates and widened the bracket so that most of us experience a tax benefit. 


With most legislations, most times it is set for a certain time period. 


So like this recent tax reform, it is set to sunset in 2025 and it will actually revert back to the 2017 numbers. So nothing changes and we’ve seen examples in legislation where something actually is fixed or changed before the 2025 deadline that changes for the future, but if nothing is changed before then it will send back to 2017 levels. 


And really what that is pointing out is that there is a time and a window of opportunity where we know what we can accomplish. 


Maybe that is Roth conversions. Or maybe that is moving certain accounts or taking certain accounts and taking advantage of those lower rates. 


And this is especially, think if you are someone who recently retired or are going to be retiring, let’s say in the next couple of years, you’re really going to have to a few years here where you can do something if you want to have these lower tax rates, these wider brackets, we can do a lot of things. 


So that’s why we are calling your attention to this now, before 2025, because you still have some time to make some changes. 


And the big theme in all of this is let’s be looking ahead. What’s going to be happening? What can we take advantage of and what should we be aware of?

As always there is a lot here, but if we can help you, please reach out. We are always happy to help. 


Contact Financial Design Studio, Financial Advisors in Deer Park.

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